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Can the iPad Save the Newspaper Industry?

By Rick Munarriz – Updated Apr 6, 2017 at 11:40PM

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Murdoch gambles on his iPad-only "The Daily" as the newspaper's savior.

Print is yesterday's news in every sense of the word.

I make it a point to walk over to the University of Miami for lunch at least once a week. It's easy exercise. It also reminds me of how old I keep getting.

One of the more jarring sights I see is two stacks of newspapers by the entrance to the school's main food court. Students are invited to grab complimentary copies of The Miami Herald and USA Today. The stacks are high when I arrive. They remain just as high when I leave. I've never seen a single copy snagged by students who simply have better means to acquire fresher news that's relevant to them.

In short, print newspapers can't even give themselves away on campus.

News Corp.'s (NYSE: NWS) Rupert Murdoch is no dummy. He knows this, too. When Apple (Nasdaq: AAPL) rolled out the iPad tablet 10 months ago, the media mogul smelled an opportunity.

"It may well be the saving of the newspaper industry," he said at the time.

Now Murdoch is ready to put his money where his life preserver is.

The Daily is rolling out for the iPad today, offering 100 pages of original content a day at a reasonable price of $0.99 a week or $39.99 for an entire year. Exclusive video and rich photograph galleries feed the iPad with the eye candy it craves. Subscribers even get crossword and Sudoku puzzles to peck at on their touchscreens. Interactive charts, customized sporting news, and even some articles that can be consumed as audio sweeten the deal.

I was skeptical of Murdoch's ability to get consumers to pay on a medium where free content is everywhere when this plan was initially hatched last year. I like Murdoch's chances now.

It's not perfect. I don't necessarily need local weather given the plethora of free Web apps out there. I think more can be done to cash in on the viral nature of Web 2.0 than simply providing Web-friendly versions of articles that can be shares on Facebook and Twitter. Wow, did Murdoch really mention Facebook and not his own company's fading MySpace? This guy gets it more than I thought.

The newspaper industry needs this.

The print industry is suffering from declining circulations and advertising revenue. Digital revenue is growing, but not enough to offset the overall slide.

Gannett (NYSE: GCI) -- the company responsible for the unread copies of USA Today collecting dust at my alma mater -- posted its quarterly results on Monday. Earnings grew nicely, but publishing revenue continues to gash itself on the rocky Slip 'n Slide we call reality.

New York Times (NYSE: NYT), Washington Post (NYSE: WPO), and The Miami Herald parent McClatchy (NYSE: MNI) have yet to report, but analysts see top-line declines there, too.

Most publishers have already embraced Amazon.com's (Nasdaq: AMZN) Kindle e-reader as a source for digital distribution, and The Daily is bound to trigger copycats on the colorful and more interactive iPad and even cooler tablets that are on the way (including Apple's own iPad 2).

The Daily has a huge opportunity here, but things may get hairy in a year or two when every breathing newspaper publisher gives the model a crack. Murdoch is pricing his publication aggressively at a fraction of what most daily print publications go for, so a shakeout's bound to happen if too many media companies crowd the niche.

If the shakeout proves newsworthy, there's a better chance that you'll read it on your iPad than on a stack of complimentary newspapers.

Print distribution will continue for elder readers or those who can't afford tablets or fear the digital migration, but if Amazon swayed bibliophiles to embrace digital books my money is on The Daily over any local daily at this point.

Is it too late to save print newspapers? Share your thoughts in the comment box below.

Apple and Amazon.com are Motley Fool Stock Advisor picks. The Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Longtime Fool contributor Rick Munarriz will probably be subscribing to Murdoch's daily this week. He does not own shares in any of the companies in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.

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Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
AAPL
$150.43 (-1.51%) $-2.31
Amazon.com, Inc. Stock Quote
Amazon.com, Inc.
AMZN
$113.78 (-3.01%) $-3.53
Gannett Co., Inc. Stock Quote
Gannett Co., Inc.
GCI
The New York Times Company Stock Quote
The New York Times Company
NYT
$27.97 (-2.58%) $0.74
Graham Holdings Company Stock Quote
Graham Holdings Company
GHC
$535.34 (-1.53%) $-8.32
The McClatchy Company Stock Quote
The McClatchy Company
MNI

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